Are Australian wine consumers willing to pay for the expert service of wine retailers?

Abstract

Retailing is continually evolving with different strategies used over time. In this era of customer relationships building, this study investigated an innovation gap; about Australian consumers' willingness to pay (WTP) a premium for the expert service of wine retailers. The study objectives were to evaluate factors that influence WTPs of wine retailers and to measure WTPs. A 2099 usable survey was obtained Australia-wide. The contingent valuation method was used to elicit the willingness of consumers. The data were analysed using the ordered probit model. On average, the premium respondents indicated WTP was $0.60 for the expert service of wine retailers. This study found that consumers are willing to pay for the expert service of wine retailers, and that consumers rely on the use of risk reduction strategy not only because of their perception of risk but they are also more desirous of wine knowledge and are willing to acquire it, even at a cost. This makes a strong case for the development and provision strategies of store dynamic elements such as expert service. The study has limitation as it is exploratory and cross-sectional. Confirmatory and longitudinal surveys amongst others are recommended.